Examination of Witnesses (Questions 380
- 388)
WEDNESDAY 28 OCTOBER 2009
MS EMMA
REYNOLDS
Q380 Lynne Jones:
What about cheese? Obviously it is a particular cheese that is
going to be produced in other countries, I appreciate it is a
speciality cheese, but say a cheese like cheddar. Do you source
that—?
Ms Reynolds: The vast majority
is from the UK.
Q381 Lynne Jones:
I understand you get a lot from Ireland.
Ms Reynolds: There is some Irish
supply, yes. The majority is from the UK but, yes, we do import
some, particularly for some of the value ranges where our customers
are quite price sensitive. We will sometimes be importing.
Q382 Lynne Jones:
You are trying to promote British dairy products?
Ms Reynolds: Yes. We are making
sure that customers know that this is a British dairy product.
They are given the information.
Chairman: We will have a short session
at the end where everybody who has a little observation about
their local Tesco store can mention it. I will be joining in.
Q383 David Taylor:
When this Committee last had an inquiry into the dairy industry,
quite some time ago now, I think the Honourable Member for Stroud
probably chaired it. We were unable satisfactorily to identify
the elements of cost in relation to the farmer, the processor
and the retailer. All were quoting things at the point which suited
them and they never added up to anything like the figure that
we, the consumer, were purchasing. You said a moment or two ago
to Anne McIntosh that your price was 27.37.
Ms Reynolds: 27.37 at the moment,
yes. That is per litre for our standard milk.
Q384 Miss McIntosh:
Farmgate?
Ms Reynolds: Yes.
Q385 David Taylor:
I know there is a range of types and offers but what typically
would be the price at which that would appear in the chiller cabinet?
Ms Reynolds: A pint of standard
milk at the moment is 45p.
Q386 David Taylor:
We are talking about 85 pence per litre or something like that.
It seems a substantial mark-up there.
Ms Reynolds: The feedback we have
from the Promar cost tracker is that we are paying a very fair
price for the milk at farmgate. It is done independently to take
into account the various costs that are faced on a farm. There
are obviously further costs down the chain, including in terms
of the bottling, the transportation and the promotion.
Q387 David Taylor:
Does Tesco wholly own the processors?
Ms Reynolds: No.
David Taylor: It still seems substantial.
Miss McIntosh: May I just record it seems
a very good price for many farmers.
Chairman: You have a tick in the box
from one side of the Committee. In the light of the comments from
Lynne Jones, we really would like to see a bit more English bacon
in the Kennington Lane branch because every time we go in there
it is always sold out.
David Taylor: We should have more regional
produce. In the regions in which you are milk is fine but there
is an awful lot of available stuff, particularly cheeses and other
types of product. It is not just Tesco who is guilty of this.
Q388 Chairman:
We are assiduously—
Ms Reynolds: I can send the Committee
a note on local sourcing if that would be interesting.[4]
Chairman: We are always happy to be educated.
David Taylor: Replicate what LeClerc
do or Géant or those other large supermarkets in France
where they really do get integrated with the local food suppliers
and promote them in a very effective way.
Chairman: Having stimulated our interest,
you have to make certain it is in the store so we can go and try
it.
Mr Williams: As this discussion has broadened
a bit I am a little bit nervous because I did not think I would
have to declare an interest as I am nothing to do with milk, but
I am a supplier of Tesco on a very small basis, but it will not
affect my questioning.
Chairman: Miss McIntosh wants to declare
an interest.
Miss McIntosh: Tesco hosts occasional
surgeries for me.
Chairman: You can see that we do take
a very keen interest in what you are up to. You are a very important
business. Thank you for your written evidence and thank you for
your contribution this afternoon.
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